Why Clients Shouldn't Wait to Claim Ex-Spousal Social Security Benefits

The ex-spouse is entitled to file for benefits even if their former spouse hasn’t retired or begun collecting Social Security benefits, as long as the former spouse is eligible to collect benefits and the two spouses have been divorced for at least two years.

What Clients Should Know About Claiming Ex-Spousal Benefits

As a general rule of thumb, advisors often recommend that individuals wait as long as possible to claim their Social Security benefits. That’s because their benefit increases for each year that the individual waits past full retirement age to begin collecting benefits — and individuals who start collecting Social Security before they have reached full retirement age will have a reduced benefit for their lifetime.

That logic does not apply when it comes to collecting ex-spousal benefits. While individuals will have a reduced benefit if they claim before full retirement age, they will not be entitled to delayed retirement credits and an increased benefit if they wait past full retirement age to begin collecting benefits based on their ex-spouse’s earnings record.

Individuals who have two ex-spouses and who qualify based on either of those ex-spouses are entitled to choose the higher of the two ex-spousal benefits. However, once the individual remarries, they are no longer allowed to file for benefits based on their ex-spouse’s earnings unless their subsequent spouse dies, or the marriage ends in divorce or annulment.

In addition, when an ex-spouse claims their ex-spousal benefits, it has no effect on the amount of benefits that the former spouse and their current spouse are entitled to receive. If the ex-spouse dies before the individual claims Social Security benefits based on that spouse’s earnings, the individual is no longer entitled to ex-spousal benefits (but may be entitled to survivor benefits based on the prior marriage).

Conclusion

Dealing with a divorce can be extremely complicated — especially from a financial standpoint. It’s important that clients understand their legal rights under the Social Security system to secure the income they need during retirement.

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